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Everyone has an array of cognitive biases that make it harder for them to make well-reasoned decisions, says McKinsey's Olivier Sibony. New decision-making techniques can help offset those biases, but bosses tend to be unwilling to accept the need. "[[T]he further up the hierarchy you go, the harder it becomes to say, 'My judgment is fallible,' " Sibony says. "Recognizing uncertainty and doubt -- it's not the style many executives have when they get to the top," Sibony adds.

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Business leaders should use checklists for strategic decision-making, write Philip Meissner, Olivier Sibony and Torsten Wulf. A formal process can help organizations to overcome confirmation bias and the natural tendency to downplay risks associated with new projects. "Executives who adopt this approach will free up resources for value-creating projects -- and improve their chances of keeping the names of their companies off the roll call of organizations that made notorious blunders," they write.

Policy-based financial planning can help keep clients' decision making on track in changing circumstances, overcoming heuristics and cognitive biases, and can lead to higher levels of trust and relationship commitment, write Dave Yeske and Elissa Buie. They offer a six-step process for creating, testing and reviewing financial planning policies.

Before he founded McKinsey, the young academic James McKinsey wrote one of the first books to deal with budgeting. McKinsey's insights led to a revolution in corporate management and guaranteed customers for his fledgling consulting business. "No other mechanism of management of similar scope and complexity has ever been introduced so rapidly," noted one commentator in the 1930s.

Companies do better when women are able to fulfill their potential, so bosses have an incentive to help women, writes Dana Theus. Often, that means leaders working on their own sensitivity and self-awareness. "You can't get rid of your biases, but you can understand and own them in ways that can help you be biased in more useful ways," Theus writes.

Executive decision making benefits when chief financial officers can provide objective data to offset personal bias, McKinsey Quarterly Director Olivier Sibony said. He encouraged finance executives to tap into their expertise to provide a neutral assessment of others' strategic choices. The CFO is in "a uniquely good position" to introduce a stronger decision-making process, he said. To learn more about current and emerging issues affecting CFOs, attend the AICPA National CFO Conference.